JOHANNESBURG - Sim Tshabalala yesterday took over the helm of Africa’s biggest lender by assets, in the process becoming the the sole and first black chief executive of Standard Bank after Ben Kruger stepped down with immediate effect in line with market expectations.
The 154-year-old bank, which operates in 20 countries yesterday said that it had decided to drop the joint-group chief executive structure, which was implemented in March 2013 when Tshabalala and Kruger succeeded Jacko Maree.
“The board is satisfied that the structure, which was necessary in 2013, has met and in many respects exceeded expectations,” Standard Bank said. “Accordingly, Ben Kruger steps down from the role of joint-group chief executive with immediate effect. He remains an executive director of the company, reporting to the group chief executive.”
Kruger’s new role, Standard Bank said, would include contributing to the governance, leadership and management of the group's assets on the continent among others.
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Kruger’s resignation comes in the wake of corporate and investment banking chief executive David Munro leaving to take over as chief executive of Liberty, a subsidiary of Standard Bank, in the wake of Thabo Dloti’s unexpected departure from the insurer. Standard Bank owns a 54percent stake in Liberty.
Nesan Nair, a stockbroker and portfolio manager at Sasfin Securities said the market had for some time been concerned about the joint chief executive structure.
Nair said the structure made it difficult to identify who was ultimately responsible for leading the business.
“The decision to choose just one of these equally competent executives, I think, is a move in the right direction. It means that the vision for the business is coherent and that various business units can be directed by essentially the same person’s vision,” Nair said.
Nair also said that since Kruger remained as an executive director, his input still existed at the highest level, which was also positive for Standard Bank.
“However, one can never know exactly how he feels about the change. By putting Tshabalala as chief executive, it is a move in the right direction for transformation, which will appease shareholders like the Public Investment Corporation, who have been very vocal on this issue,” he said.
Standard Bank last month fought back against the Competition Commission, applying for access to information in the foreign currency collusion probe. The bank said that it wanted the commission to furnish it with full evidence on its allegations against it, meaning that its application would now be heard separately.
It asked the Competition Tribunal on Monday to separate the exception application in the case against seventeen other banks accused of currency manipulation.
Standard Bank said its interim profits to June surged 12percent to R12.1billion, while headline earnings grew 46percent, supported by the Africa region, which offset the dilution impact from the rand strength.
Richard Hasson, a manager at Electus Fund Managers in Cape Town also said that the dual chief executive structures were unpopular. He said that the market never favoured joint chief executive roles in any company as it made assigning accountability for group strategy and performance difficult.
Also read: Standard Bank joint CEO Kruger steps down, leaving Sim Tshabalala as sole CEO
“We see this resignation from the joint chief executive position as a positive for Standard Bank and an event that was always likely to occur,” Hasson said. “Although Ben Kruger has resigned from the joint chief executive role he remains an executive director at Standard Bank and a key part of the management team.”
Mergence Investments chief investment officer Bradley Preston said yesterday that Kruger’s resignation was in line with market expectations.
“The market did not like the joint-group chief executive structure, and it is comfortable with Tshabalala’s leadership,” said Preston.
Standard Bank shares declined 0.31percent on the JSE yesterday to close at R162.38.